The Singapore Solution: How did a sleepy little island transform into a high-tech powerhouse in one generation? It was all in the plan.

If you want to get a Singaporean to look up from a beloved dish of fish-head curry—or make a harried cabdriver slam on his brakes—say you are going to interview the country’s “minister mentor,” Lee Kuan Yew, and would like an opinion about what to ask him. “The MM?Wah lau! You’re going to see the MM? Real?” You might as well have told a resident of the Emerald City that you’re late for an appointment with the Wizard of Oz. After all, LKY, as he is known in acronym-mad Singapore, is more than the “father of the country.” He is its inventor, as surely as if he had scientifically formulated the place with precise portions of Plato’s Republic, Anglophile elitism, unwavering economic pragmatism, and old-fashioned strong-arm repression.

People like to call Singapore the Switzerland of Southeast Asia, and who can argue? Out of a malarial swamp, the tiny island at the southernmost tip of the Malay Peninsula gained independence from Britain in 1963 and, in one generation, transformed itself into a legendarily efficient place, where the per capita income for its 3.7 million citizens exceeds that of many European countries, the education and health systems rival anything in the West, government officials are largely corruption free, 90 percent of households own their own homes, taxes are relatively low and sidewalks are clean, and there are no visible homeless people or slums.

If all that, plus a typical unemployment rate of about 3 percent and a nice stash of money in the bank thanks to the government’s enforced savings plan, doesn’t sound sweet to you, just travel 600 miles south and try getting by in a Jakarta shantytown.

Achieving all this has required a delicate balancing act, an often paradoxical interplay between what some Singaporeans refer to as “the big stick and the big carrot.” What strikes you first is the carrot: giddy financial growth fueling never ending construction and consumerism. Against this is the stick, most often symbolized by the infamous ban on chewing gum and the caning of people for spray-painting cars. Disruptive things like racial and religious disharmony? They’re simply not allowed, and no one steals anyone else’s wallet.

Singapore, maybe more than anywhere else, crystallizes an elemental question: What price prosperity and security? Are they worth living in a place that many contend is a socially engineered, nose-to-the-grindstone, workaholic rat race, where the self-perpetuating ruling party enforces draconian laws (your airport entry card informs you, in red letters, that the penalty for drug trafficking is “DEATH”), squashes press freedom, and offers a debatable level of financial transparency? Some people joke that the government micromanages the details of life right down to how well Singapore Airlines flight attendants fill out their batik-patterned dresses.

They say Lee Kuan Yew has mellowed over the years, but when he walks into the interview wearing a zippered blue jacket, looking like a flint-eyed Asian Clint Eastwood circa Gran Torino, you know you’d better get on with it. While it is not exactly clear what a minister mentor does, good luck finding many Singaporeans who don’t believe that the Old Man is still top dog, the ultimate string puller behind the curtain. Told most of my questions have come from Singaporeans, the MM, now 86 but as sharp and unsentimental as a barbed tack, offers a bring-it-on smile: “At my age I’ve had many eggs thrown at me.”

Few living leaders—Fidel Castro in Cuba, Nelson Mandela in South Africa, and Robert Mugabe in Zimbabwe come to mind—have dominated their homeland’s national narrative the way Lee Kuan Yew has. Born into a well-to-do Chinese family in 1923, deeply influenced by both British colonial society and the brutal Japanese occupation that killed as many as 50,000 people on the island in the mid-1940s, the erstwhile “Harry Lee,” Cambridge law degree in hand, first came to prominence as a leader of a left-leaning anticolonial movement in the 1950s. Firming up his personal power within the ascendant People’s Action Party, Lee became Singapore’s first prime minister, filling the post for 26 years. He was senior minister for another 15; his current minister mentor title was established when his son, Lee Hsien Loong, became prime minister in 2004.

Lee masterminded the celebrated “Singapore Model,” converting a country one-eighth the size of Delaware, with no natural resources and a fractured mix of ethnicities, into “Singapore, Inc.” He attracted foreign investment by building communications and transportation infrastructure, made English the official language, created a superefficient government by paying top administrators salaries equal to those in private companies, and cracked down on corruption until it disappeared. The model—a unique mix of economic empowerment and tightly controlled personal liberties—has inspired imitators in China, Russia, and eastern Europe.

To lead a society, the MM says in his precise Victorian English, “one must understand human nature. I have always thought that humanity was animal-like. The Confucian theory was man could be improved, but I’m not sure he can be. He can be trained, he can be disciplined.” In Singapore that has meant lots of rules—prohibiting littering, spitting on sidewalks, failing to flush public toilets—with fines and occasional outing in the newspaper for those who break them. It also meant educating his people—industrious by nature—and converting them from shopkeepers to high-tech workers in a few decades.

Over time, the MM says, Singaporeans have become “less hard-driving and hard-striving.” This is why it is a good thing, the MM says, that the nation has welcomed so many Chinese immigrants (25 percent of the population is now foreign-born). He is aware that many Singaporeans are unhappy with the influx of immigrants, especially those educated newcomers prepared to fight for higher paying jobs. But taking a typically Darwinian stance, the MM describes the country’s new subjects as “hungry,” with parents who “pushed the children very hard.” If native Singaporeans are falling behind because “the spurs are not stuck into the hide,” that is their problem.

If there is a single word that sums up the Singaporean existential condition, it is kiasu, a term that means “afraid to lose.” In a society that begins tracking its students into test-based groups at age ten (“special” and “express” are the top tiers; “normal” is the path for those headed for factory and service-sector work), kiasu seeps in early, eventually germinating in brilliant engineering students and phallic high-rises with a Bulgari store on the ground floor. Singaporeans are big on being number one in everything, but in a kiasu world, winning is never completely sweet, carrying with it the dread of ceasing to win. When the Singapore port, the busiest container hub in the world, slipped behind Shanghai in 2005 in total cargo tonnage handled, it was a national calamity.

One day, as part of a rehearsal for the National Day celebration, I was treated to a veritable lollapalooza of kiasu. Singapore armed forces playacted at subduing a cabal of “terrorists” who had shot a half dozen flower-bearing children in red leotards, leaving them “dead” on the stage. “We’re not North Korea, but we try,” said one observer, commenting on the rolling tanks, zooming Apache helicopters, and earsplitting 21-gun salutes. You hear it all the time: The only way for Singapore to survive being surrounded by massive neighbors is to remain constantly vigilant. The 2009 military budget is $11.4 billion, or 5 percent of GDP, among the world’s highest rates.

You never know where the threat might come from, or what form it will take. Last summer everyone was in a panic about swine flu. Mask-wearing health monitors were positioned around the city. On Saturday night, no matter how stylo milo your threads, there was no way of getting into a club on trendy Clarke Quay without a bouncer pressing a handheld thermometer to your forehead. It was part of the unending Singaporean state of siege. Many of the newer public housing apartments come with a bomb shelter, complete with a steel door. After a while, the perceived danger and excessive compliance with rules get internalized; one thing you don’t see in Singapore is very many police. “The cop is inside our heads,” one resident says.

Self-censorship is rampant in Singapore, where dealing with the powers that be is “a dance,” says Alvin Tan, the artistic director of the Necessary Stage, which has put on dozens of plays dealing with touchy issues such as the death penalty and sexuality. Tan spends a lot of time with the government censors. “You have to use the proper approach,” he says. “If they say ’south,’ you don’t say ‘north.’ You say ‘northeast.’ Go from there. It’s a negotiation.”

Those who do not learn their steps in the dance soon get the message. Consider the case of Siew Kum Hong, a 35-year-old Singaporean who thought he’d be furthering the cause of openness by serving as an unelected NMP, or nominated member of parliament. With only four opposition MPs elected in the history of the country, the ruling party thought NMPs might provide the appearance of “a more consensual style of government where alternative views are heard and constructive dissent accommodated.” This was how Siew Kum Hong told me he viewed his position, but he was passed over for another term.

“I thought I was doing a good job,” a surprised Kum Hong says. What it came down to, he surmises, were “those ‘no’ votes.” When he first voted no, on a resolution he felt discriminated against gays, his colleagues “went absolutely silent. It was the first time since I’d been in parliament that anyone had ever voted no.” When he voted no again, this time on a law lowering the number of people who could assemble to protest, the reaction was similarly cool. “So much for alternative views,” Kum Hong says.

The Singapore government is not unaware of the pitfalls of its highly controlled society. One concern is the “creativity crisis,” the fear that an emphasis on rote learning in Singapore’s schools is not conducive to producing game-changing ideas. Yet attempts to encourage originality have been tone-deaf. When Scape, a youth outreach group, opened a “graffiti wall,” youngsters were instructed to submit graffiti designs for consideration; those chosen would be painted on a designated wall at an assigned time.

Similarly, the government has maintained a campaign against the use of “Singlish,” the multiculti gumbo of Malay, Hokkien Chinese, Tamil, and English street patois that is Singapore’s great linguistic achievement. As you sit in a Starbucks listening to teens saying things like “You blur like sotong, lah!” (roughly, “You’re dumber than squid, man!”), Singlish seems a brilliantly subversive attack on the very conformity the government claims it is trying to overcome. Then again, one of Singlish’s major conceits is the ironic lionization of the flashy, down-market “Ah Beng” culture of Chinese immigrant thugs and their sunglass-wearing Malay counterparts. You know that won’t fly in a world where the MM (“minister de-mentor” in Beng speak) has advocated “assortative mating,” the idea that college graduates should marry only other college graduates so as to uplift the national stock.

Perhaps the most troubling problem facing the nation is a result of its overly successful population control program, which ran in the 1970s with the slogan “Two Is Enough.” Today Singaporeans are simply not reproducing, so the country must depend on immigrants to keep the population growing. The government offers baby bonuses and long maternity leaves, but nothing will help unless Singaporeans start having more sex. According to a poll by the Durex condom company, Singaporeans have less intercourse than almost any other country on Earth. “We are shrinking in our population,” the MM says. “Our fertility rate is 1.29. It is a worrying factor.” This could be the fatal error in the Singapore Model: The eventual extinction of Singaporeans.

But there is an upside to all this social engineering. You could feel it during the “We Are the World” production numbers in the National Day show. On stage were representatives of Singapore’s major ethnic groups, the Chinese, Malays, and Indians, all wearing colorful costumes. After riots in the 1960s, the government installed a strict quota system in public housing to make sure that ethnic groups did not create their own monolithic quarters. This practice may have more to do with controlling the populace than with true multiracial harmony, but at the rehearsal, as schmaltzy as it was, it was hard not to be moved by the earnest show of brotherhood. However invented, there is something called Singaporean, and it is real. Whatever people’s grumbles—and as the MM says, “Singaporeans are champion grumblers”—Singapore is their home, and they love it despite everything. It makes you like the place too, for their sake.

The kicker is that things are about to change. In a famous quote, Lee Kuan Yew said, “If you are going to lower me into the grave, and I feel something is wrong, I will get up.” But this is beyond even him. “We all know the MM will die someday,” says Calvin Fones, a psychiatrist who runs a clinic at Gleneagles Hospital on Orchard Road. Fones likens his homeland to a family. “When the country was young, there was a need for wise oversight. A firm hand. Now we are in adolescence, which can be a questioning, troublesome period. Coming into it without the presence of the patriarch will be a test.”

The great engine of cultural change, of course, is the Internet, that cyber fly in the authoritarian ointment. Lee acknowledges the threat. “We banned Playboy in the sixties, and it is still banned, that’s true, but now, with the Internet, you get much more than you ever could from Playboy.” Allowing pornography sites while banning magazines may seem contradictory. But attempting to censor the Internet, as has been tried in China, would be pointless, Lee says. It is an exquisitely pragmatic reply.

And so bloggers, like the satirist Mr. Brown and the urbanely pugnacious Yawning Bread, are free to broadcast opinions unlikely to be found in the pages of the government-linked Straits Times. As a result, more and more young people are questioning the trade-off between freedom and security—and even calling for freer politics and fewer social controls.

Last August, a wide-ranging speech by new NMP Viswa Sadasivan created a lot of buzz on the blogosphere: “I do lament our lack of freedom to express ourselves, and the government’s seemingly unmitigated grip on power and what appears to be an inconsistent willingness to listen to public sentiment that does not suit it,” Viswa said before parliament. “Accountability requires the government to go beyond lip-service in addressing the call for greater democracy … If not, people are likely to feel increasingly alienated.”

Irked by Viswa’s criticisms of the way some ethnic groups are treated in Singapore, LKY interrupted a medical treatment to angrily refute the “highfalutin” speech in a rare appearance on the parliament floor. The patriarch, in case anyone needed reminding, was not yet in his grave.

Singapore can be a disconcerting place, even to the people who call it home, though they’d never think of leaving. As one local put it, “Singapore is like a warm bath. You sink in, slit your wrists, your lifeblood floats away, but hey, it’s warm.” If that’s so, most Singaporeans figure they might as well go down the tubes eating pepper crabs, with a couple of curry puffs on the side. Eating is the true national pastime and refuge. The longer I stayed, the more I ate. It got so I’d go over to the marvelously overcrowded Maxwell Road Food Centre, stand in the 20-minute queue for a plate at the Tian Tian food stall, eat it, then line up again.

On my last day, I climbed the hill in the Bukit Timah Nature Reserve, at 537 feet the highest point on the island and the closest thing in Singapore to the jungle it once was. In the unexpected quiet, I returned to what the MM had said about Confucius’s belief “that man could be perfected.” This was, the MM said with a sigh, “an optimistic way of looking at life.” People abuse freedom. That is his beef with America: The rights of individuals to do their own thing allow them to misbehave at the expense of an orderly society. As they say in Singapore: What good are all those rights if you’re afraid to go out at night?

When I got to the top of the hill, I thought I might be rewarded with a view of the entire city-state. But there was no view at all—only a rusting communication tower and a cyclone fence affixed with a sign saying “Protected Place” and showing a stick figure drawing of a soldier aiming a rifle at a man with his hands raised.

Later I mentioned this to Calvin Fones, the shrink. “See, that shows the progress we’ve made,” he said. “Until a few years ago, we had the same sign, except the guy was lying on the ground, already shot.” And then, being a Singaporean, living a life he didn’t believe possible anywhere else in Asia, he laughed.